Slovakia sticks with E.ON for ZSE utility sale

Despite protests from Austria’s EVN, which submitted a higher bid for Slovakia’s power distributor ZSE, the Slovakian government panel were undeterred in its choice to stay with Germany’s E.ON as the winner of the tender.

The government’s steering committee for the sale of a 49 per cent stake and management control of one of the country’s three regional power distributors, recommend E.ON as the winner in April.

Austrian energy utility EVN has criticized the decision and called on the government, which has to give the final approval to the verdict, to reverse it. Robert Merva, from the privatization ministry, said the ministry could not disclose the details of the bids yet, but a source familiar with the sale said that EVN had offered to pay €351m ($322m) compared with E.ON’s €330m.

Merva said: “The price had 80 per cent weighting in the criteria, but the committee was not looking just for the highest price … It chose the best offer as a whole, and the decision was unanimous.”

ZSE is the largest and most lucrative of the three power distributors, whose connections to grids in neighbouring countries made them attractive as future cross-border transit companies in light of the EU’s plans to expand eastwards in 2004.

A separate government committee had recommended Electricité de France to take control of Slovakia’s second largest distributor, SSE, while RWE Plus was tipped to buy 49 per cent of VSE, the smallest of the power utilities, for a combined $429m.

SwedPower group to aid Kosovo rebuild

A consortium led by SwedPower International, a Vattenfall subsidiary, has just won a major contract to provide management and technical assistance to KEK, the power utility in Kosovo, to help reshape the power industry.

The consortium comprises Germany’s Veag, Laubag and Veag PowerConsult, all under the Vattenfall umbrella. The two-year contract worth over €9m ($8.2m) was awarded by the European Agency for Reconstruction, which is responsible for the management of the main EU assistance programmes in Kosovo.

The region is served by KEK’s two brown coal-based power plants in Pristina but their total output of 800 MW is used ineffectively. The main task is to develop management and technical skills and to address technical and non-technical losses by establishing proper billing and payment systems.

Czech state gives green light to CEZ distribution sales

The Czech government has approved the sale of its majority stakes in eight power distributors to leading utility CEZ.

In return the government will buy a 66 per cent stake in national grid operators CEPS from CEZ. CEZ will pay the state around CKr37bn ($1.1bn) for the distributor stakes and will receive CKr15bn for the CEPS sale, said Libor Roucek, government spokesman.

CEZ will have until June 2006 to pay the remaining CKr17bn to the state. CEZ will finance the purchase from domestic capital markets and through loans.

Although the government had wanted to sell off the power industry in one package to a single investor, the cabinet pulled the tender when it was disappointed by bids from major foreign investors. Instead the government turned to merging the distributors with CEZ to create a giant vertically integrated company. CEPS is likely to eventually be sold off.

E.ON is hungry for expansion

E.ON Hungarian, a wholly-owned subsidiary of E.ON Energie, will strengthen its position in end-customer electricity supply in Hungary as a result of its agreement to buy Electricté de France’s (EDF) 27.7 per cent stake in northwest Hungarian electricity supplier Edasz.

Carried out as part of a public purchase, the deal brings an end to a long-running dispute between E.ON and EDF over control of Edasz. Already holding 27.7 per cent of Edasz, E.ON will double its ownership to 55.4 per cent after swallowing EDF’s stake. Both are the only shareholders holding more than five per cent of Edasz.

Enviromondial signs Iran deal

Enviromondial Inc., a small Montreal-based company, has landed a deal for a $24m contract from the Iranian government for its technology that turns household waste into electricity.

The company will build, own and operate a plant capable of generating 35 MW of electric power by burning gas derived from waste at Sari, on the Caspian Sea, in the province of Mazandaran.

News digest

Algeria: VA Tech has been awarded a contract for the supply of a new 66/31.5 kV – 20 MVA mobile substation for the Kouba Hydro plant which distributes potable water to Algiers, the capital city of Algeria.

Estonia: Metso Automation was awarded an automation solution order from Foster Wheeler to be installed at Eesti and Balti power plants near the city of Narva in eastern Estonia. The power plants belong to national power company Eesti Energia company and burn local oil shale.

Ghana: The Volta River Authority (VRA) has disclosed that the level of the Volta Lake has dropped so much that it now produces only half of the hydro-electricty it normally generates. Electric power derived from the dam for sale to the Electricity Company of Ghana by the VRA which constituted between 70 per cent and 80 per cent has been been slashed to 50 per cent.

Kuwait: Nexans has just won a new €52m contract in Kuwait for the supply and turnkey installation of several 300 kV high voltage power cable connections in Kuwait City, between the Salmieh X substation and six other peripheral substations.

Nambia: ABB has won an order worth $12m to build a transmission line for NanPower in Nambia. The transmission line will run from Van Eck Power Station in Windhoek to the new Walmund Substation near Walvis Bay. The order involves the design, manufacture, factory testing, supply, delivery to site and complete erection.

Nigeria: ABB announced it has won contracts worth $44m from Nigeria’s state-owned National Electric Power Authority for two transmission and distribution projects to upgrade the country’s electricity supply infrastructure.

UAE: The Federal Electricity and Water Authority of the UAE has selected gas turbines from GE Power Systems for the expansion of two power plants in Nakheel and Qidfa in a deal worth $60.5m.

UAE: ABB announced it has signed a $3.9m contract to upgrade Abu Dhabi Water and Electricity Authority’s (ADWEA) load dispatch system. The project will help Abu Dhabi adapt to a new structure of ownership of power plants by expanding the present national system to allow inclusion of privately owned electricity and water suppliers.

Uganda: Parliament passed a resolution authorizing the government to borrow $49m from the world Bank for the Energy for Rural Transformation Project (ERTP). The loan would be repaid in 40 years with a grace period of ten years and a 0.75 per cent interest rate.